14. On March 1, 2020, Apalla and Cabañero formed a partnership with eachcontributing the following assets:CabañeroP502,500 P 1,172,5001,256,2503,768,750ApallaCashMachinery and equipment 418,750BuildingFurniture and fixtures167,500The building is subject to mortgage loan of P1,340,000, which is to beassumed by the partnership. Agreement provides that Apalla and Cabañeroshare profits and losses 30% and 70%, respectively. On March 1, 2020 thebalance in Cabañero's capital account should be:a. P6,197,500b. P5,259,500C. P5,108,750d. P4,857,50015. The same information in the previous number, except that the mortgageloan is not assumed by the partnership. On March 1, 2020 the balance inCabañero's capital account should be:a. P6,197,500b. P5,259,500C. P5,108,750d. P4,857,500

PARTNERSHIP : It is an arrangement between two or more people who are in the contract or agreement…

Answered: 14. banero formed a partnership with…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The partnership agreement of the G&P general partnership states that Gary will receive a guaranteed payment of $14,100, and that Gary and Prudence will share the remaining profits or losses in a 45/55 ratio. For year 1, the G&P partnership reports the following results: Sales revenue Gain on sale of land (§1231) Cost of goods sold Depreciation-MACRS Employee wages Cash charitable contributions Municipal bond interest Other expenses $ 91,500 7,500 (53,500) (15,600) (11,100) (5,300) 5,450 (5,100) Note: Negative amounts should be indicated by a minus sign. Required: a-1. How much ordinary income (loss) is allocated to Gary for the year? a-2. Compute Gary's share of separately stated items to be reported on his year 1 Schedule K-1, including his self-employment income (loss). Complete this question by entering your answers in the tabs below. Required A1 Required A2 How much ordinary income (loss) is allocated to Gary for the year? Note: Round your intermediate computations to the nearest…
A, B, and C are partners with present capital balances of P40,000, P50,000, and P20,000, respectively. The partners share profits and losses according to the following percentages: 60% for A, 30% for B, and 10% for C. D is to join the partnership upon contributing P40,000 to the partnership in exchange for a 25% interest in capital and a 20% interest in profits and losses. An appraisal of the existing partnerships' assets reveals the following: Accounts Receivable P20,000 overvalued Inventory P10,000 overvalued Land P10,000 undervalued Building P15,000 undervalued Calculate the capital balances for each individual in the new partnership assuming use of the bonus method.
In the January 1, 2020 Kalaw and Borromeo formed partnership with each contributing the following: Kalaw Borromeo Cash 50,000 70,000 Equipments 50,000 75,000 Building 225,000 Furniture 10,000 Accounts payable 20,000 Loans Payable 100,000 All liabilities are to be assumed by the partnership. The partners agreed the equipments should be provided a 20% depreciation and the building has a market value of 200,000. The value of the furniture should be decreased by P2,000 There is an unrecorded liability in the books of Kalaw amounting to P2,000 and accrued interest on loans to Borromeo amounting to 5% of the loans. How much is the total capital of the partners before the agreed adjustments
A and B enter into a partnership agreement contributing their respective business' assets at fair market values: Cash Accounts Receivable Machinery and Equipment Land A 60,000 200,000 120,000 B 200,000 430,000 Additional information: An Allowance for Doubtful Accounts of 2% of accounts receivable is to be set up; . The land is subject to a mortgage loan of P24,000 which the partnership will assume. The partnership agreement states that A and B share profits and losses, 40% and 60%, respectively, and partners agreed to bring their capital balances in proportion to the profit and loss ratio. Compute the amount of bonus that should be given to one partner.
Partners ABC, DEF, GHI and JKL initially invested P45,000; P60,000; P65,000 and P85,000 each to form a partnership on July 1, 2022. They divide profit and losses based on the following: a. b. C. d. chip RSIY A Annual Salaries of P15,000, P20,000 and P20,000 to ABC, DEF and GHI; 10% interest on original capital to GHI; 25% bonus to JKL of net income; The balance is to be divided into a 4:3:2:1 JKL Each respectively. If ABC and GHI received a total of P57.00 DIFICtio to ABC, DEF, GHI and compute the share of JKL from the net income of the partnership from the net income for 2022,
The following is the trail Balance of X and Y Co. as on March 31, 2021. The partners sharing profits and losses in the ratio 2:1. Prepare the Income Statement, Profit & Loss Appropriation A/c, Partners' Capital A/c and the Balance Sheet. Particulars Dr. Particulars Cr. 375000 x Capital A/c 112500 Y Capital A/c 50000 Sundry creditors 100000 Sales (net) 50000 Discount Land and Buildings Plant and Machinery 125000 75000 Wages 62500 Opening Stock of Finished Goods 812500 Opening Stock of Raw material Opening Stock of Work in Progress Sundry debtors 6250 45000 Provision for bad debts 3750 125000 Commission 3750 Y's Loan A/c 2250 25000 Carriage inwards 75000 Carriage outwards Factory Expenses 18750 Royalties 3750 Purchase of Raw material (net) 187500 16250 7250 10000 Factory rent & taxes Discount Office rent Insurance 5000 3750 18750 30000 20500 1185000 The following additional information is to be taken into consideration: Bad debts Office Expenses Salaries of works manager Cash at bank…
A, B, and C are in partnership as recreational suppliers, sharing residual profits or losses in the ratio of 5:2:3 respectively. At 1st November 2011 their capital and current balances were: Capital account Current account TZS TZS A 8,000,000 580,000 Cr 10,000,000 350,000 Dr 12,000,000 210,000 Cr Avitus Dominick: Msc Finance and Investment, CPA (T ) & BAC (0714-336097) 16
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A&B form a partnership with A being the limited partner (LP)who will invest $150,000 and B being the general partner (GP). The group finds a property for $700,000 and takes a mortgage for $550,000, interest only at 6%. They agree to a 90/10 split on the profits and distributions while the property is owned by the group. Assume the following: Gross Income- $125,000 LESS VACANCY- $6,250 LESS OPERATING EXPENSES - $27,000 What is the capital account of investor A (the LP) $87,000 $97,125 $139,875 $150,000
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On January 1, FRED and GEMMO formed a partnership by contributing cash of P405,000 and P270,000, respectively. On February 1. Fred contributed an additional P135,000. On May 1, Gemmo contributed machinery with a fair market value of P90,000 and a net book value/cost of P75,000 when contributed. On November 1 Gemmo contributed an additional P45,000 cash to the partnership. Profit or loss agreement are as follows: • Interest at 6% is allowed on average capital balances; • Salaries of P2,700 per month to each partner; • Bonus to Fred of 10% of net income; and • Balance to be divided in the ratio of 6:4 to Fred and Gemmo, respectively. ASSUMPTIONS: 1. The company had a revenue of 458,300 and expenses of 227, 900 resulting in a profit of 257,400. 2. The company had a revenue of 227, 900 and expenses of 458,300 resulting in a loss of 257,400. 3. The company had a revenue of 458,300 and expenses of 406,325 resulting in a profit of 51,975. Required: 1. Table showing the computation of average…
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